Among SameSystem’s investors is the Danish asset manager BankInvest, which offers investment products ranging from equities, over market equities and debt via regular bonds to venture capital funds.
We had a conversation with Niels Andersen, Portfolio Manager at BankInvest, about their decision to invest in SameSystem.
Full confidence in new leadership
“When we select investment candidates, our first criterion is that the leadership is competent and capable of executing strategies and achieving objectives. Although Henrik Salicath is new to the role of CEO of SameSystem, we are confident that the relationship between the Ritlov family and Salicath is viable, “he says.
“We are very comfortable with the entire leadership team. We have also met Mikael Christensen, Global Sales Director, and Tobias Ritlov, Head of Product, a few times and both have what we are looking for in good leadership: Track record, experience, credibility and a go-getter attitude – all of which are crucial in a young company like SameSystem that is set to grow rapidly in the years to come.”
The list of customers says it all
SameSystem’s customer portfolio is another reason why BankInvest has chosen to invest in the company, explains Niels Andersen.
“When we invest, we look for ‘proof of product and technology’. Here, SameSystem scores very high in our models. We have rarely seen a more impressive customer portfolio. Although we are ‘laymen’ in terms of assessing the technology and its acceptance by customers, the customer list with 731 customers in 21 countries speaks for itself, really.”
SameSystem has international potential
The customer list is not the only way that SameSystem has proven its ability to deliver, according to BankInvest.
“We want to invest in companies with ‘proof of commercial excellence’ – demonstrated ability, willingness and commitment to sell good products and good technology. SameSystems historical growth is impressive, they have the right customers and most importantly the company is growing internationally,” says Niels Andersen and continues:
“BankInvest looks for companies with international potential that have proven that they are capable of selling products internationally. SameSystem belongs to this category. We are aware that growth during the COVID-19 pandemic has been lower than in the previous years, but that is understandable given that retail is among the hardest hit sectors. Still, there has been growth, which is impressive.”
“We consider the acceleration expected in guidance to be realistic. COVID-19 will soon be behind us, and the company is well on track to build a platform that delivers growth.”
BankInvest believes that the growth potential in Europe is significant:
“We invest in companies that sell into large growth markets. SameSystem sells into a European market of 5 million retail stores with a total value of 25 billion. The market is so large that there are no excuses for not becoming a much larger company – very quickly.
The entry valuation is fair
Lastly, it was important for BankInvest to get a reasonable entry valuation:
”On the US stock exchange, SaaS companies trade at 14-15x ARR, while the Danish and European valuation is lower. Competitors on the Danish market are between 8-10x ARR for 2021, and SameSystem is in that range. We think at least 3-5 years ahead, and our valuation models go even further. We have a portfolio approach where we build a portfolio of growth companies in our fund because we know that not all growth companies are successful. However, SameSystem has a good chance of succeeding – and if the company succeeds, it could be big,” says BankInvest’s Niels Andersen.
